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Widespread Corporate Hacking Lands Two Russians In Prison

Two Russian nationals have been handed prison sentences for their roles in hacking corporates and financial institutions (FIs) in the U.S., Bloomberg reported this week.

The publication said the two individuals, Vladimir Drinkman and Dmitriy Smilianets, were involved in a computer hacking scheme that impacted 17 retailers in the U.S., including 7-Eleven and JCPenney. Drinkman was sentenced to 12 years in prison, while Smilianets was sentenced to 51 months and 21 days for his role as a black market broker. The two pled guilty in September 2015.

The two were part of a larger group that stole online credentials, personal information and credit and debit card numbers between 2005 and 2012. Smilianets sold that information online; he reportedly charged $10 for American credit card numbers, $15 for Canadian ones and $50 for European ones. Prosecutors said three of the 17 companies affected by the hacks lost more than $300 million.

Three individuals suspected of participating in the scheme remain at large: Aleksandr Kalinin, Roman Kotov and Mikhail Rytikov.

The prison sentences, handed down by U.S. District Judge Jerome Simandle in Camden, New Jersey, follow reports released earlier this week that hackers stole more than $17 million from Russian banks in 2017.

That data suggests Russian targets are as susceptible as the U.S. and other jurisdictions when it comes to cyberattacks, but the U.S. government has been working hard to combat Russian cybercriminals targeting U.S. entities. Late last year, the U.S.’ Joshua Aaron was extradited from Russia for his alleged involvement in the 2014 hacking of JPMorgan, following extensive discussions between the two countries, reports in Bloomberg said at the time.

While the U.S. continues to focus on safeguarding corporates and FIs against external threats, the nation’s business community is also struggling with record levels of fraud. Reports last year from the Association for Financial Professionals found 75 percent of businesses surveyed said they had fallen victim to check fraud in 2017, up from 71 percent in 2015. The business email compromise scam saw an increase of 10 percent during those two years.

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